Every day more and more companies, large and small are looking to capitalize on their existing capabilities through the use of the Internet. This process of leveraging strengths and disturbing habits of the tried and true of migration from "big market to market space."
There are many who still believe that there is no profitable business on the web. Value for the customer and the company are the only two ways to be successful. This means that a company must understand their customers on time and context to achieve their business objective. Internet offers companies a change to do what you have always done, but in a very different fashion, adding further value to the business and the customer.
There are many business strategies that exploit the Internet as an interactive means of reaching many and emphasize communication and community.
Three business models that are working successfully for some companies are on the auction model, the portal model and storefront model.
This article will explore the three business models. After reading this article, you should then be able to determine which business model is more conducive to the operation and growth of the business.
The auction model has gained popularity since the beginning of e-Bay. Auction models are those in which participants have an offer of products or services on the internet. The auction sites sometimes do not have the products on its site, but facilitates the process of listing and displaying goods as an affiliate.
auction models have a market for individuals and businesses to auction goods or service. "In English auctions, the initial price starts low and is bid by successive bidders with the highest winner of the offer. In a Dutch auction, multiple, identical objects are offered at an auction, with all .. winning bidders pay the same price, usually the highest price at which all items will be sold most online auctions are currently using the English method "(Nissanoff, 06)
the advantages of the auction business model include:
- there are no time limits. Supply and publication of the articles can be completed 24/7.
- There are no geographical constraints. Sellers and bidders can participate from anywhere in the world.
- The large number of bidders. The potential for low prices, many items and services available, easy access, and the social benefit attracts a large number of bidders.
- large number of sellers. The number of bidders brings a high potential price and reduced selling costs making more sellers choose the auction model.
- network economy. Most sellers, more bidders and this cycle continues. The more the spiral operates, the larger the system becomes, making it the most valuable business model for all participants.
In general, the business model of the portal is an "infomediary." A portal brings sellers and buyers together by providing content in the form of consultancy, services, or any other performance.
A portal is the gateway for users when they connect to the Internet. the portal business models offer services such as breaking news, online directories, personalized ads, targeted e-mail newsletters of products and services, and a structure to create a single corporate website within the portal pain making the portal an important facilitator of trade with the addition of a value for a particular transaction and e-business.
Revenues from the portal business model is earned with advertising, website hosting, construction, designing web sites, sponsorship of discussion forums and negotiate a percentage of each transaction that occurs on market.
The shop business model is facing a cart position that customers can browse and shop from the comfort of their homes, and where companies can advertise their products and services to a fraction of the cost of bricks and mortar businesses.
The shop is accessed through a portal or directly and entering the shop site; the customer is shown the display graphics to give a person a chance to see what the product looks like, just as if he / she found in the brick and mortar store. Once the purchase is made, a form is filled in a position to transmit financial information and issue a receipt for the customer.
Three types of storefront models are "good, goods and services soft hard." durable goods are similar to operate sales of on-line catalog. Sales of non-durable goods or information assets based is perfect for the Internet because everything can be made and received on the internet.
Some companies use the storefront models to sell goods, such as e-Bay, others use it to reduce costs through marketing and customer support, and then the others are using it to generate new sales. Companies that actually benefit of a store model are those that sell unique products that are either hard to find or can not be found in the area.
The advantages of a shop selling model includes extensive and marketing, reduce transaction costs, introduction of new products and testing and the ability to reach specialized markets.
With over 0 million users on the web; Internet is a fascinating place to do business. There are wide variations in companies operating on the web. big, small, or in between, it does not matter because everything comes to customer commitment.
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